TOKYO, March 27, 2025 (BSS/AFP) - Shares in Japan's biggest car companies fell on Thursday after US President Donald Trump announced a 25 percent tariff on auto imports to take effect next week.

The world's top-selling automaker Toyota dropped 3.7 percent as the Tokyo market opened, while Nissan shed 3.2 percent and Honda fell as much as 3.1 percent.

Mitsubishi Motors was down 3.7 percent, and in South Korea, Hyundai shares dipped 3.4 percent.

The auto industry is a huge pillar of the Japanese economy, with about 10 percent of jobs there connected to the sector.

Vehicles accounted for roughly a third of Japan's 21.3 trillion yen ($142 billion) of US-bound exports in 2024.

Earlier in March, the chair of the Japan Automobile Manufacturers Association (JAMA) warned of the impact of US trade protectionism at a Tokyo press conference.

A 25 percent tariff "would have a negative impact overall on the economies of the United States and Japan", Masanori Katayama said.

Japanese ministers have been lobbying their US counterparts to secure tariff exemptions for goods like steel and vehicles, but these requests have been denied.

The Trump administration says levies are a way to raise government revenue, revitalise American industry and press countries on US priorities.

But targeting imported cars could strain ties with close US partners.

About 50 percent of cars sold in the United States are manufactured within the country. Among imports, about half come from Mexico and Canada, with Japan, South Korea and Germany also major suppliers.